Wednesday, March 17, 2004

Rube Goldberg, Disney, Wal-Mart and Beyond

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What do Disneyworld, Wal-Mart, and Star Trek type science fiction videos have in common? Not much – except the pervasive role of technology. Understanding how technologies of manufacturing and marketing deployed globally is a fascinating saga of our times.

In fact, this story starts before Disney – in the early part of the 20th century, the “age of the machine”. In this period, people were fascinated by the visible and marvelous powers of science and technology – ranging from Ford Model T to the whimsically spoofed machines in Rube Goldberg cartoons. One of the great embodiments of the spirit of machines was the St. Louis expo of 1904. A website detailing the preamble and attractions of this expo states the following (http://www.bitwise.net/~ken-bill/fair.htm) :

Think for a moment about the world of 1904. The Wright Brothers’ famous flight at Kitty Hawk occurred the previous year. Gasoline-powered automobiles, motion pictures, and the “wonder drug” aspirin were introduced to the public only 10 years before. Electric lighting and telephones were less than 25 years old, and still a novelty only read about by most Americans. Food was stored in ice boxes, and the horse-drawn ice wagon was a familiar site.

But from Opening Day - April 30, 1904 - to the closing ceremonies on December 1st of that same year, the St. Louis World’s Fair played host to nearly 20 million visitors, who witnessed the public debut of air conditioning, were able to ice skate throughout the entire summer, and spoke by wireless telegraph to cities 1500 mile away.
In this era of the machine – let us honor Rube Goldberg, the whimsical cartoonist of the machine, by calling this the era of “goldbergization” – the machine produced results in visible ways.


Most of the visible mechanization was in the factories, but retail spaces saw some sprinkling of mechanization in the form of accessibility by automobiles and the use of cash registers. By the 1950s, cities like New York even had massive vending machines that dispensed all manners of food – the food preparation and stocking being done by invisible humans in the background. But retail culture proved too difficult to mechanize.

The model that succeeded was the opposite of the automated New York food-vending delis. This is the model epitomized by McDonald’s. In the typical McDonald’s retail outlet, the mechanization is largely obscured, behind a partial wall where food preparation is done. Human order takers are key parts of the McDonald’s retail equation. They are trained to smile, accept orders, punch in codes to transmit the order to workers in the back doing the preparation and packing, accept money, and make change by automated methods.

While goldbergization had limited sway in retail spaces, it was Disney who took retail technology to the next step. In disneyfication, the retail technology is invisible and yet palpable. The wondrous animatronics are close to (caricatures of) live humans and animals, but the wiring and the motors are invisible. Disney’s “cast members” – the smiling, friendly human workers with some histrionic skills – assist the animatronics performers and settings.

In goldbergization, the viewer-customer is awed by visible technology producing visible results. In disneyfication, the viewer-customer-guest is awed by invisible technology producing visible results.

While the technologies of disneyfication are invisible, they are palpable at some level: viewers-customers-guests have faint cognitions of the awesome technological prowess that must lie behind the Disneyland backdrops.

Now, “Welcome to Wal-Mart”! The gentle elderly greeter at the door mutters this, and offers to help and guide anyone that asks for assistance. The loose-fitting uniforms, the price-marking gun in one hand, the Normal Rockwell grooming, the “Aw, Shucks!” demeanor of the Wal-Mart “associate” – technology is the farthest thing in your mind as you enter Wal-Mart, unless you came in to buy a computer or a flat-panel TV. Everything is done to promote the schlock milieu of “Always Low Prices.” The tacky newspaper ads that have the aesthetics of 19th century news bills, simply stacked shelves, somewhat unkempt aisles overflowing with seasonal merchandise, the functional fluorescent lighting – this ain’t Abercrombie & Fitch, or even Old Navy.

Yet, behind the schlock-laced façade of Wal-Mart, there is powerful and ruthlessly efficient technology that disciplines every link of the supply chain and keeps employees on their toes, almost literally. So legendary is the back office technology of Wal-Mart that it has elicited paeans of praise in consulting company reports and Harvard Business Review articles. Wal-Mart of course is the biggest company and its owners, members of the Walton family, the richest people on the planet.

So, what is walmartization? In goldbergization, the viewer-customer is awed by visible technology producing visible results. In disneyfication, viewers-customers-guests are wowed by invisible (but palpable) technology producing visible results. In walmartization, totally invisible technology disciplines unseen supply chains to produce seductive low prices for the customer in schlock low-tech settings.

In the 16 March 2004 issue of The Guardian, George Monbiot has this to say about Wal-Mart and similar superstores:

In the US [Wal-Mart’s] sales clerks made an average of $13,861 in 2001, almost $800 below the federal poverty line for a family of three. It is reported to have told new employees how to apply for food stamps so that they don’t starve to death….By forcing down the prices of the goods they buy, the superstores encourage even more repressive conditions in the companies which supply them. A recent study by Oxfam documents the systematic abuse of workers in the factories and farms they buy from. The Waltons are so rich because others are so poor.

But, capitalism, technology, and globalization grind on…. So, where is the next stop? This brings us, somewhat surprisingly, to Star Trek. In the types of sci-fi fantasies favored in some of the story lines of Star Trek and similar video fare, there are often “worlds” that are serenely pastoral – somewhat like the “Aw, Shucks” Norman Rockwell world of the visible side of Wal-Mart. Yet, in those sci-fi worlds, as the story line unfolds, we usually learn of deeply embedded technologies orchestrating the whole serene-idyllic-pastoral thing.

The logical extension of walmartization is to push super-efficient technologies offshore – to the factories of China and Indonesia, to the software shops of India and Vietnam, to the call centers of Ghana and the Philippines. Then, not only are these technologies invisible, they are unreachable except via long and tiring plane rides, or via super-high-bandwidth telecommunications. Walmartization spawns goldbergization in the super-efficient factories in China, ten times the size of football fields, to support the schlock-style disneyfication of its retail superstores in America.

But wait, there’s more… as those pushy late-night TV commercials tell us! Here is what Forbes magazine (the self-proclaimed “Capitalist Tool”) reported in March 2004:

Wal-Mart Stores Inc, which runs 33 chain stores across the country [China], posted a more modest 5.85 billion yuan [about $0.8 billion] in sales, but bought $15 billion worth of goods in 2003, the [China Securities Journal] newspaper said. Underscoring the emphasis placed on the mainland by foreign retailers, Wal-Mart said last week it had held its first-ever annual board meeting in China…

The next act of the Goldberg-McDonalds-Disney-Wal-Mart saga would likely end not with Mickey’s Midnight Parade in Orlando, Florida but with a spectacular dragon dance in the streets of Shanghai.


Nik Dholakia


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Thumb Tribes of Asia?

In the sprawling, oft-cavernous mazes of Tokyo’s train stations such as Shinjuku and Shibuya roam the hip-dressed creatures of oyayubi-zoku. Yes, the oyayubi-zoku are the ubiquitous “thumb tribes” of Japan, young people who are constantly thumbing text messages, downloading pictures, or doing other e-transactions using their keitai, the mobile phone handsets.

The thumb tribes are adept at using the keypad of the mobile phones to do an astonishing variety of electronic tasks. Given the long commutes of Tokyo, and the ban on doing voice conversations in trains, it is no wonder that Japan has spawned these thumb tribes.

Technology, however, is never neutral. The growth of the thumb tribes has an unintended consequence. Japan was a nation of voracious readers, much of it facilitated by the long commutes on trains. No matter that over 40% of the reading was in the form of “manga”, the famed illustrated comics with wide-eyed Anime characters, it was still reading. Even the comic-strip manga tackled complex subjects such as global warming or AIDS. Now, the oyayubi-zoku are forsaking reading in droves and turning to thumbing. By some estimates, after the popularity of i-Mode and similar technologies, book publishing in Japan has dropped by 20% or more.

But wait! Can these thumb tribes emerge and survive in poor countries, such as those of South Asia? You bet they can, with proper motivation. Here is a story of a maid working in a rich Bangladesh household. The maid asked the rich, educated lady of the house if she could use the lady’s mobile phone to inquire about the health of a relative back in the village. The lady of the house agreed and asked for the number. The maid was illiterate and said she did not know the number. The maid took the mobile phone, however, and punched in a sequence of numbers and got connected to the village.

Amazed at this, the lady of the household asked: “How did you do it? You do not know how to read or write!” The maid replied: “It is true, Madam… I am illiterate, but I know which keys to push on the keypad!”

Rather than lamenting or celebrating the oyayubi-zoku of rich and educated Japan, perhaps it is time to promote and motivate oyayubi-zoku in the illiterate and semi-literate populations of South Asia and Africa. The mobile keypad holds the promise of bridging the growing digital divides of these regions of the world.

….er….gotta go…. that’s my cell phone ringing…!!

Nik Dholakia

India's 998 Million Problem

Trenchant critics of India's galloping IT-led globalization have commented, quite rightly, about the 330 million Indians whose lives have barely changed in the hubbub of India's software-saturated ethos of the twentyfirst century. India's underclass continues to be the largest in the world, and there are no easy signposts as to where economic and political policy should be headed to solve the problems of poverty, margnialization, and urban decay.

Those out of power in New Delhi, or the state capitals, of course have the easy answer: Get the bums who are in power out of office! As we all know, this rings quite hollow. Those other bums ruled for four decades, and they did not make much of a dent in the size or situation of the underclass.

There is, however, a much larger demographic challenge than the 330 million number.

India's workforce, even if we generously include the burgeoning American-accented but barely IT-literate Call Center workers, is perhaps 2 million strong. So, where does that leave the rest of the 998 million Indians? Leaving aside children, we are still talking of 500-600 million people for whom IT is as foreign as Redmond, Washington.

The year 2004 started in India with the top politicians declaring the advent of a strangely-named "feel good" revolution of rising expectations and consumption. The opitmists hope that this Ladder to the ITES (Information Technology Enabled Services) Heaven will continue to shoot up to the ether and beyond, pulling more and more Indians up the India Shining rungs of this ladder.

Yes, colleges are exploding and technical graduates in 2010 could be double the number in 1995.

But in the demographic cauldron that is India, these IT-trained numbers will melt into the workforce without much of a trace.

Yes, even the illiterate farming family now dreams of educating some of its children for good jobs in the cities.

Yes, the notorious Trickle Down theory so favored by Ronald Reagan will come into play, but the trickles will be absorbed quickly into multitudes of India's exploding demographic centers -- the cities.

The educational revolutions and the income-lifestyle revolutions will be slurped and soaked up by the parched demographic sponge that we call India. For the half-a-trillion on the wrong side of the digital divide, there are no easy answers.

Picture this: The Ladder to the ITES Heaven has its upper rungs stretching into a misty ethereal Paradise of Pleasures. But look, there are no lower rungs of this ladder planted firmly on India's rural soil! This is a floating ladder, not the fabled beansprout that Jack planted, which stretched from strong roots in the earth all the way to the moon!

Nik Dholakia

Tuesday, March 02, 2004

Offshoring as a Cultural Conduit

New York Times op-ed columnist Thomas Friedman was visiting a software maker in Bangalore India in February 2004. The CEO of the Indian firm said to Friedman to look around the office in Bangalore: "All the computers are from Compaq. The basic software is from Microsoft. The phones are from Lucent. The air-conditioning is by Carrier, and even the bottled water is by Coke..." wrote Friedman in one of his February 2004 NYT op-ed pieces after observing this office in India.

So, is outsourcing to foreign shores, or "offshoring" as it is often called, just an American corporate ploy to create new markets for American goods in developing nations such as India, China, and Vietnam? Is it in fact the backdoor Trojan horse for propagating American culture?

Such an assertion would be either cynical or it would grant an overly prescient quality to America's foreign economic policy.

That said, it is clear that offshoring has a strong cultural component. In any offshoring process originating from the United States, some aspects of American culture are transplanted abroad. Why? Because offshoing entails slicing the business process and reenacting that slice of the process abroad. In such reenactment, some cultural elements that are concomitant of the business process also get reenacted aborad. Business processes, especially service processes, are saturated with culture -- pieces of service pound cakes soaked in the American cultural rum. After all, answering the telephone from Delhi in an American accent requires a good degree of Americanization of the worker abroad.

Such cultural flows have happened in the offshoring of manufacturing industries for decades and of extractive industries for centuries. But in the offshoring of services, the cultural flow is much stronger. After all, a service is almost entirely created and delivered by humans, with some assistance by technology. Especially if such a service has interpersonal qualities, then the service worker abroad is exposed to yet another cultural influence: the voice or the email writer at the other end, in America.

In the case of services, insulating the local culture from foreign influences is far more difficult than in the case of manufacturing, and similarly manufacturing has far more cultural impact than extractive or agricultural work.

The "banana boat" of contemporary globalization brings the "service bananas" to USA while silently shipping cultural slices of All-American Apple Pie abroad. And, unlike the slow moving ocean boats, the "banana boat" of service and software globalization moves at a lightening speed, on telecom and Internet backbones.

In fact, "offshoring of jobs" -- a hot political potato of the 2004 Election Year America -- is also the cultural "invasion of the body snatchers" of this century, where Asian bodies are being abducted surreptitiously and impregnated imperceptibly by American Culture. Of course, this creates cultural anomalies, even clashes, in those exoting foreign offshoing lands. But money washes over and colors everything. Heck, what's wrong with some Americanization if it helps fatten up the pay packet at month end?

It is thus not American jobs going abroad. Rather it is the cloning of Americans abroad.

Now, if only a U.S. constitutional amedment can be passed to give American voting rights to these newly cloned quasi-Americans, then the political defenders of American capitalism would have no worries. They would get voted in, year after year, by the new "Amerindians"!

Nik Dholakia